Setting up an accounting system

Depending on the number of transactions a company has, one could record transactions in an excel file or could think of setting up an accounting system.

The simplest and probably one of the more popular systems would be Quickbooks (QB). They have a desktop version which in this day and age is not the best choice as one needs to be on a particular server so working remote is not as easy. Their cloud based offering is a good option. Setting up the system is easy. You could also link your bank, your credit card, billing software, planning apps to the accounting system.

But if there are multiple entities, QB definitely shouldn’t be your first choice. There would be a whole lot of manual process involved in getting through the consolidations. There are few other quirks in the system- like if you want to void a check in a prior period you can do that but in order for the numbers to not change you need to manually book an entry to reverse the voiding entry. And then reverse the manual entry in the period that is still open. But if you don’t care for changing numbers in a prior period that has already been closed, go ahead void the checks!

There are other mid range systems like Intacct and NetSuite which would be a next step when the company has more complex structure.

If you have inventory, Quickbooks might not be the best option then as well. A mid tier system would be better aligned. There are definitely the big systems like SAP and Oracle that would be the next step for the company when the scale is big enough to warrant the system.

News

On November 10,1494, the first book about double entry systems was published by the Italian mathematician, Lua Pacioli, also known as the father of accounting. In his honor the day is celebrated as the International Accountants Day! To all fellow accountants, keep up the great work.

Italy's Antitrust authority fined the big 4 (Ernst & Young, Deloitte, KPMG and PWC) a total of 23 million euros for allegedly conspiring and colluding to divvy up large public consultancy contracts. Looks like the Big 4 need to revise their Ethics class!

Two more corporate shareholders filed a legal claim against Toshiba, linked to the the 2015 accounting scandal, seeking $5.08 million in compensation for damages. This brings the total damages sought to $1.2 billion!